Further improvements in anti-dirty money regulations sought

REGULATORS and policy makers continue to make sure that the tighter anti-money laundering and counter-terrorism measures are being implemented properly.

Anti-Money Laundering Council (AMLC) Executive Director Mel Georgie B. Racela said the Philippines still needs to address gaps in areas identified by the Financial Action Task Force (FATF) in its previous assessment.

“Each country must enforce these measures and ensure that the operational, law enforcement, and legal components of an anti-money laundering/counter-terrorism financing system work together effectively to achieve a passing rate of ‘substantial’ for each of the 11 immediate outcomes,” he said in a Viber message.

“Recall that we were rated ‘substantial’ only in immediate outcome 1, which is risk assessment, and fell short in all other immediate outcomes,” Mr. Racela added.

The Paris-based dirty money watchdog assesses countries’ efforts against money laundering and terrorism through immediate outcomes in areas such as risk assessment; international cooperation; supervision; preventive measures implemented by the private sector; legal persons and arrangements, and beneficial ownership information; financial intelligence; money laundering investigation and prosecution; confiscation; terrorism financing investigation and prosecution; targeted financial sanctions; and proliferation financing.

The Philippines addressed these deficiencies in terms of technical compliance through Republic Act No. 11521 which amended the Anti-Money Laundering Act and Republic Act No. 11479 or the Anti-Terror Act of 2020. Technical compliance refers to prevailing laws and regulations that are in line with FATF standards and criteria.

“Although these [laws] have only been passed recently, we are committed to demonstrate effective implementation,” Mr. Racela said.

The Philippines was removed from the FATF’s gray list of countries deemed to have lax measures against dirty money and terrorism financing in February 2005, five years after its inclusion in 2000. The country was under a one-year observation period that was extended until Feb. 1, 2021, when it was expected to have addressed the gaps in its anti-money and counter-terrorism financing rules.

Mr. Racela said they started submitting the post-observation period reports on March 30, which covered immediate outcomes related to international cooperation and financial intelligence. He said they will submit reports related to other standards to FATF on April 6.

“We are optimistic that the FATF will note the country’s significant accomplishments given the limited time and the special circumstance that the world is currently in,” he said.

Amid implementing a tighter watch and regulations against dirty money, the AMLC has issued freeze orders for assets worth about P2.2 billion from 2019 to 2020. — Luz Wendy T. Noble